Binance’s Reaction to Regulatory Pressures: Provides Brokers with Guidelines for Enhanced Customer Verification.
Binance, the cryptocurrency exchange, has been making headlines recently due to its regulatory and compliance issues, and now it is taking steps to address these concerns. It has reportedly instructed prime brokers, such as FalconX and Hidden Road, to gather detailed information on its clients in order to strengthen its compliance and regulatory measures.
Binance is specifically focusing on preventing US investors from using its platform, and it has instructed prime brokers to implement strict verification procedures. These procedures include thorough checks on office locations, employee and founder locations, and the accuracy of information provided by respondents.
This move comes after Binance’s former CEO was found to have violated the Bank Secrecy Act last year, resulting in a $4.3 billion penalty. The US Department of Justice accused Binance of anti-money laundering, fraud, and sanctions law violations, as well as targeting US customers and failing to comply with relevant legislation.
The crypto sector is closely monitoring Binance’s compliance with regulations. According to insiders, Binance has also tightened its criteria for listing new digital tokens. In response to inquiries about the increased checks by prime brokers, Binance stated that it is fully committed to compliance and has made its standards transparent to provide clarity to enterprises seeking access to its liquidity.
Despite these regulatory challenges, Bitcoin’s price has soared in the past year, bringing hope and optimism to the digital asset industry. Binance’s BNB Coin has also performed well, surpassing Bitcoin’s growth rate with an 80% increase this year. Its Total Value Locked (TVL) has also risen from $67 billion to $112.5 billion since November, according to data from DefiLlama.
Overall, Binance is taking steps to address its regulatory and compliance issues while still maintaining a strong position in the market.